Advertisement
Enter values and click Calculate
Advertisement

The Power of Compounding in Trading

A 5% monthly return on a $5,000 account may sound modest — but compounded over 24 months, that account grows to over $16,000. After 5 years, it exceeds $88,000. This is why professional traders focus relentlessly on consistency over big wins.

The optional monthly withdrawal feature lets you see what happens when you take profits out each month versus leaving them in to compound.

Frequently Asked Questions

Is a 5% monthly return realistic?

For experienced traders, yes — but it requires discipline and consistency. Many professional traders target 2–5% per month. Higher returns are possible but come with higher risk.

Should I withdraw profits or compound them?

Compounding accelerates growth but you need to be patient. Many traders split profits — withdraw a portion for living expenses and compound the rest.

What if I have losing months?

This calculator shows a consistent return scenario. In reality, returns vary. Use the Expectancy Calculator to model realistic variable returns.